The final dividend has been scrapped, a target to generate £300m from disposals this year has been set, and a £775m rights issue has been unveiled. On top of that, the insurer swung to a £224m pre-tax loss in 2013, compared with a £448m profit a year earlier.

No doubt the group’s preliminary results will have made uncomfortable reading for RSA’s shareholders, even those primed for bad news. For example, the amount sought from the rights issue is higher than some had been expecting.

Still, investors should not necessarily take fright at the dilution the rights issue will entail and jump ship before the terms of the capital-raising are disclosed. Instead, they should have some faith in Mr Hester’s ability to revive the insurer’s fortunes.

When his appointment was announced earlier this month, analysts were quick to give the former Royal Bank of Scotland boss a warm welcome.

Oliver Steel of Deutsche Bank said that the broker’s banking team rated Mr Hester as “excellent”, noting that in the past he had shown “a high degree of openness”. The experts at Barclays told clients that Mr Hester was “a proven CEO with a track record of tackling challenging restructuring stories”.

RSA’s new chief appeared to live up to expectations when he unveiled his first set of results. He was candid with shareholders, acknowledging the group was in a “difficult position” of making the “significant” cash call, while at the same time posting “poor” numbers. He also demonstrated a clear understanding that RSA’s problems are much broader than the fraud discovered at its Irish business.

The plan proposed by Mr Hester has already impressed rating agency Standard & Poor’s, which upgraded RSA on Friday and said the measures “will result in a material improvement in prospective balance sheet strength”. Questor is minded to agree.

RSA’s appeal to income investors will have been damaged by the group’s decision to axe the dividend but those willing to gamble on the insurer as a speculative recovery play should stand firm.

The prospect of a predator swooping on RSA while its shares remain at depressed levels should also be kept in mind. RSA remains a high-risk Buy.